Jury selection begins in Elizabeth Holmes’ Theranos fraud trial
Jury selection begins Tuesday in the hotly anticipated and high-profile fraud trial of Elizabeth Holmes, the disgraced founder of blood testing start-up Theranos.
Selection is expected to take at least two days as attorneys battle over who ought to determine Holmes’ fate. If convicted, she could face 20 years in prison.
Opening statements are slated for Sept. 8 and the trial is expected to last for weeks.
Holmes, 37, was once among Silicon Valley’s most high-profile founders and briefly crowned the country’s youngest female self-made billionaire.
She and her ex-boyfriend Ramesh “Sunny” Balwani, former Theranos COO, are now charged with ten counts of wire fraud and two counts of conspiracy in what’s expected to be one of the most high-profile corporate fraud trials in years.
Both Homes and Balwani, 56, have pleaded not guilty. Balwani will face his own trial next year.
Holmes’ trial has been delayed multiple times, first because of pandemic-related restrictions and then because of Holmes’ pregnancy. She gave birth to a baby boy in July.
According to pre-trial court filings, jurors can expect to hear from a variety of witnesses, including doctors who used the tests on patients and people who used Theranos’ blood-testing equipment but got false results.
Theranos patients set to take the stand include one man who was misled to believe he had prostate cancer and two other patients who got false positive HIV test results. However, the scope of their testimony must be limited to the fact that they were misled by the tests, and not the emotional impact.
Additional court filings unsealed over the weekend suggest that Holmes will point the finger at Balwani, arguing that he masterminded the Theranos fraud and she was captive to his interests.
In unsealed documents, Holmes’ attorneys claimed that she suffered a “decade-long campaign of psychological abuse” from Balwani, who rejected the allegations through his attorneys.
The US Department of Justice charged Holmes and Balwani in 2018, accusing them of defrauding investors, medical professionals, and customers.
Before her arrest, Holmes — a Steve Jobs wannabe who dressed exclusively in black turtlenecks — at one point scored a more than $9 billion valuation for Theranos.
Her company claimed to be able to detect medical conditions like cancer by using their new technology on a tiny sample of customers’ blood.
Theranos eventually struck big-time deals with Walgreens and grocery chain Safeway.
Her board of directors boasted prominent US officials, including former Secretaries of State Henry Kissinger and George Shultz as well as former Secretary of Defense James Mattis.
And Theranos counted some of the country’s wealthiest business leaders, including former Education Secretary Betsy DeVos, the Walton family of Walmart and Patriots owner Robert Kraft, among its investors. Some of those investors may testify at Holmes’ trial.
But the company’s medical claims were debunked in a 2015 Wall Street Journal article, sending Theranos’ sky-high valuation crashing down and sparking an eventual criminal investigation into Holmes and others involved in the business.
That day, Holmes went on CNBC’s “Mad Money” with Jim Cramer to rebuff the charges, and claimed the paper was out to stifle innovation.
“First they call you crazy, then they fight you, then you change the world,” she said on CNBC, paraphrasing a quote that’s often misattributed to Mahatma Gandhi.
